Uganda in sh8.8 trillion debt, says Suruma
Feb 27, 2007
UGANDA’S debt has reached sh8.8trillion, finance minister Dr. Ezra Suruma said yesterday. He attributed the debt to the failure of some ministries to use the loans secured by the Government.
By Fortunate Ahimbisibwe
UGANDA’S debt has reached sh8.8trillion, finance minister Dr. Ezra Suruma said yesterday. He attributed the debt to the failure of some ministries to use the loans secured by the Government.
Suruma said sh2.5 trillion of the money had not been utilised by various departments and that it had attracted a penalty from the lenders.
He named the works and agriculture ministries as the poorest utilisers of the loans. “The ministries of health and education have done very well. They have a utilisation rate of 80% but other sectors have between 30-50%.â€
Suruma made the remarks while speaking to journalists at the Media Centre in Kampala.
He said sh6.7b had been lost in taxes and commitments because of the idle funds. “Many of the lending organisations have stringent procedures which makes it difficult to utilise the funds as soon as the agreement has been signed. We also have procedures that delay the process.â€
A commitment is the percentage of the loan that the lending institution retains.
Suruma revealed that a 0.5% commitment fee is charged on undisbursed funds. He attributed the underutilisation of the money to long periods of project design, complicated procedures by lending agencies and delays in approval of loans by Parliament.
He said the Government was negotiating for better borrowing terms.
Uganda’s external debt was reduced from $4.5b to $500m (sh875b) in April last year.
This was after the World Bank, the International Monetary Fund and the African Development Bank wrote off the debt.
UGANDA’S debt has reached sh8.8trillion, finance minister Dr. Ezra Suruma said yesterday. He attributed the debt to the failure of some ministries to use the loans secured by the Government.
Suruma said sh2.5 trillion of the money had not been utilised by various departments and that it had attracted a penalty from the lenders.
He named the works and agriculture ministries as the poorest utilisers of the loans. “The ministries of health and education have done very well. They have a utilisation rate of 80% but other sectors have between 30-50%.â€
Suruma made the remarks while speaking to journalists at the Media Centre in Kampala.
He said sh6.7b had been lost in taxes and commitments because of the idle funds. “Many of the lending organisations have stringent procedures which makes it difficult to utilise the funds as soon as the agreement has been signed. We also have procedures that delay the process.â€
A commitment is the percentage of the loan that the lending institution retains.
Suruma revealed that a 0.5% commitment fee is charged on undisbursed funds. He attributed the underutilisation of the money to long periods of project design, complicated procedures by lending agencies and delays in approval of loans by Parliament.
He said the Government was negotiating for better borrowing terms.
Uganda’s external debt was reduced from $4.5b to $500m (sh875b) in April last year.
This was after the World Bank, the International Monetary Fund and the African Development Bank wrote off the debt.